Georgia lawmakers weigh whether to levy tax on Uber, Lyft rides

Updated: Uber is urging Georgia lawmakers to slam the brakes on a House proposal that would allow the state to collect a 4 percent state sales tax on each trip with ride-hailing services, as well as allow cities to collect their own fees.

Uber sent an email to thousands of its riders this week under the heading “stop your Uber prices from going up” that urged them to tell lawmakers to vote down House Bill 225.

The measure cleared a committee this week and is expected to reach a vote before the full House on Friday, the final day for a bill to move from one chamber to the other this year. It would apply to Lyft and other ride-hailing services.

Many states don’t tax riders at all for trips on Uber or Lyft, while a few – such as South Carolina – levy a 1 percent fee for each ride. Rhode Island is the only state that applies sales tax to ride-sharing services, enacting a 7 percent sales tax last year.

If the Georgia measure passes, Uber said the combined tax in Atlanta would near 9 percent and average 7 percent across the rest of the state. Uber spokeswoman Evangeline George said the company would embrace a “modern fee structure” but called the House measure too regressive.

“This legislation would force Georgians to pay a high tax on each and every Uber ride - one that is out of step with states across the country and would hurt the millions in our state who depend on Uber’s affordability,” she said.

The measure’s sponsor, state Rep. Jay Powell, said it clears up “disagreement” under state law that requires the services to pony up state sales tax.

He and other supporters argued the tax is already assessed but the ride share services are passing the buck to their drivers. Powell said the measure would put in place a legal mechanism to collect what is due.

“It makes it clear that ride-share networks are covered under our sales tax law,” said Powell, R-Camilla, at a committee hearing.